Indian shares fell on Monday on concerns a slowing economy would further dent earnings, which are expected to have been hit in the past quarter due to high interest rates and sluggish consumer spending.
The main BSE index was down 0.8 percent at 15,721.8 by 10:40 a.m. (0510 GMT), a day after the prime minister trimmed growth projection to about 7 percent this fiscal year, below a downwardly revised forecast of about 7.5 percent issued by his government last month.
Twenty-five of the 30 index components fell.
The prime minister's statement on further reduction in growth has had an impact, said K.K. Mital, head of portfolio management at Globe Capital. When the growth projections are lowered, banks and capital intensive companies are hit ... automobile stocks are also down.
Energy major Reliance Industries led the losses and fell 1 percent, while engineering conglomerate Larsen and Toubro dropped 1.9 percent.
Top lender State Bank of India shed 1.7 percent, while rivals ICICI Bank fell 1.3 percent and HDFC Bank slipped 0.6 percent.
Truck and car maker Tata Motors fell 2 percent to 199 rupees after Deutsche Bank downgraded the stock to 'sell' from 'buy', saying weak demand and rising competition could squeeze margins in the domestic market.
Mahindra and Mahindra, the country's largest utility vehicles maker, fell 1.6 percent.
Export-focused software companies bucked the trend and rose as the rupee weakened against the dollar. with Infosys climbing 0.7 percent ahead of its quarterly results on Thursday. Bigger rival Tata Consultancy Services was up 0.3 percent.
The broader 50-share NSE index was down 0.8 percent at 4,708. In the broader market, there were 1.2 losers for every gainer on volume of 135.6 million shares.
STOCKS ON THE MOVE
* Jaiprakash Associates fell 1.7 percent after the stock exchange regulator fined its top executives, including the chairman, on charges of insider trading. The founders have said they would challenge the order.
* Pratibha Industries rose 7.3 percent after the company said it had received orders worth 7.72 billion rupees.
* UltraTech Cement fell 0.4 percent after the Business Standard reported the company was evaluating a possible buyout of the South Africa operations of France's Lafarge SA. A spokeswoman for the Aditya Birla Group, which runs the company, declined to comment.
TOP THREE BY VOLUME
* Suzlon Energy (SUZL.NS) on 5.58 million shares
* Jaiprakash Associates (JAIA.NS) on 4.06 million shares
* Rashtriya Chemicals (RSTC.NS) on 3.59 million shares